July/August 2002

AGRReportsbreaking news

PRICING

NAGS Makes Sweeping Price Changes
National Auto Glass Specifications International (NAGS) has announced that it will no longer base NAGS prices on manufacturers' published truckload pricing, but rather will use a hybrid method of pricing, which it says is "based on the established acquisition costs for the retailer" of auto glass. The new NAGS Calculator, effective May 6, contains sweeping changes in the pricing of more than 8,000 parts. It is the largest number of price changes since the NAGS Revaluation in January 1999.

"Due to certain changes at the truckload level, particularly over the past twelve months, this method is no longer reliable even with the adjustments we began making at the time of the revaluation in January of 1999," says a letter on the inside cover of the May 6 edition of the calculator. "Those adjustments were based on our market research and judgment and were intended to address known anomalies in the market. Despite those efforts, there have been noticeable increases in net priced parts during that period. There have also been growing issues with certain parts that present a loss when sold at either the wholesale or retail level."
(See "Back to the
Future" for related story and industry reaction.)

LEGAL

Safelite Anwers Diamond Triumph’s Complaint

Columbus, Ohio-based Safelite Glass Corp. has answered an amended complaint filed by Diamond Triumph Auto Glass. Safelite denied the Kingston, Pa., company's claim of steering in the 20-page answer filed on May 26 by Charles A. Shea II, Esquire, of Kingston, Pa., an attorney representing Safelite in the case, which was filed originally on April 7, 2002.

Safelite denies all allegations of steering made throughout Diamond Triumph's 54-page complaint, answering paragraph by paragraph. The only admissions are those of empirical facts, such as that Safelite is based in Columbus, repairs and replaces auto glass and operates call centers for several of the major insurance companies.

However, to more specific allegations, such as the allegation that Safelite steered USAA insured Roxanne Shively of Rockville, Md., to one of its shops away from another against her wishes, Safelite states that it "is without sufficient knowledge or information to form a belief about Ms. Shively's wishes, about communications between Ms. Shively and USAA, and about communications between Ms. Shively and Diamond."

For each of the other specific allegations issued by Diamond Triumph, Safelite issues a similar statement of denial. One of the company's few admissions reads as follows: "Safelite admits that on or about February 1, 2002, Diamond's counsel sent Safelite a letter mentioning some of the issues set forth in this complaint and admits that Safelite's counsel responded with a letter and copies of certain transcripts of calls from the call center."

However, it continues, "Safelite specifically denies that it engaged in any 'conduct' warranting or suggesting that Safelite should 'voluntarily halt' and denies all other allegations contained in paragraph 67."

Safelite ends with a request that the complaint be dismissed, and that it be awarded judgement in its favor and against Diamond Triumph, including court costs, attorneys' fees and "all other just and proper relief."

Safelite spokesperson Dee Uttermohlen said that many in the industry are assuming Safelite is guilty, but that the case is still in litigation and Diamond-Triumph's charges have not been proven.
"It is important to remember that just because we have been sued does not mean we are liable, but that is what Diamond Triumph would like [people] to believe," Utterhmohlen said. "Diamond Triumph is required by law to prove by specific facts that we are liable. The facts that we have discovered to date regarding the specific policyholder transactions cited in the lawsuit indicate that we have honored policyholder preference and executed the program according to our client's direction."

Calls to Diamond Triumph remained unreturned. At press time, the Court had not yet decided what action it might take. Diamond Triumph is requesting a trial and monetary retributions for the damages it says Safelite has caused in its business.

(See "Steer Crazy"
for the industry's reaction to this landmark case.)

LEGAL

CCRA Imposes Provisional Duties on Chinese WindshieldsThe Canada Customs and Revenue Agency (CCRA) has announced that it will assess provisional duties on imports on certain automotive laminated windshields for the automotive replacement market from the People's Republic of China (PRC).

This decision follows an investigation initiated by the CCRA after receiving a complaint filed by PPG Canada Inc. of Toronto. The company is alleging that the dumping of the goods in question is causing price suppression and erosion, lost sales, loss of market share, reduced income and profitability and underutilization of production capacity to the Canadian production

The preliminary results of the investigation show that the imports from the PRC were dumped into Canada at prices that were 35 percent below normal levels. Provisional duties ranging from 36 to 194 percent are being imposed on PRC imports to eliminate the dumping. The Canadian investigation follows a year-long U.S. investigation in which the International Trade Commission determined that Chinese windshields were being dumped in the United States, causing harm to its market, and imposed duties on Chinese windshield manufacturers importing replacement windshields into the United States.

Dumping occurs when goods are sold to importers in Canada at unprofitable prices or prices that are less than the selling prices in the exporter's domestic market. The Special Import Measures Act protects Canadian producers from the damaging effects of such unfair trade.

Lamiver Inc. had supported PPG Canada's claim, but withdrew its support at the end of May, claiming that the end result of the case would probably only benefit PPG's distribution centers.
"In our opinion, the Canadian manufacturing arm of PPG will see minimal benefits as most of their production capacity is directed toward the OEM markets in North American and abroad," wrote Lamiver president Michael J. Sartain in a May 21 letter to its fellow manufacturer. "In the case of Lamiver, our overall production capacity is not sufficient enough to displace Chinese or other manufacturers as your main windshield vendor, whether duties are imposed or not."

KUDOS

AGRR Wins Another One

Garrisonville, Va.-based AGRR magazine recently was honored by the American Society of Business Publications and Editors (ASBPE) with the bronze award for the Eastern Region Best 2001 Feature Series in the under-80,000 circulation category for contributing editor Les Shaver’s 2001 feature series, “Seeing the Lite: The State of Plastic Sidelites.”
(See January/April 2002 AGRR, page 24, and May/June 2002 AGRR, page
42.)

The award was presented at a ceremony in Boston on June 10 at the Cambridge Royal Sonesta Hotel. In addition,
AGRR’s sister publication, Door & Window Maker magazine, won the bronze award for Best New Publication in the Eastern region.

Last year, AGRR was named Best New Publication 2001 by the ASBPE in the under-80,000 circulation category in both the nation and Eastern region.

COMPANIES

Saint Gobain and Central Glass Join ForcesParis-based Saint Gobain and Japan-based Central Glass have announced that they are forming a joint venture to supply Japanese auto groups worldwide. The two groups have said they will combine both their marketing and sales activities.

Saint-Gobain has little presence in Asia, while Central Glass only has a small presence in Europe, so both expect the move to be profitable. The joint venture will act as a subsidiary of both companies, who have not yet determined where they will headquarter the new company.

CONSUMER BEAT

Executive Auto Glass Displays Charitable Side
Ed Beatrice of Executive Auto Glass in Stoneham, Mass., recently presented a check for $15,000 to St. Jude Children’s Research Hospital during its fourth annual “Big Dreams Start Small” fund-raising gala at the Park Plaza in Boston. Executive Auto Glass was this year’s corporate sponsor for the event.
Beatrice also presented a check to Jim Wolski, director of the Boston Safe Kids Coalition. This season, Executive Auto Glass teamed up with Boston Bruins’ star Joe Thornton in the “Score for Charity” program. The charity, Boston Safe Kids, received a pledge from Executive Auto Glass each time Thornton scored.

BRIEFLY

American Sunroofs Infalfa, the company that represents the aftermarket operations of ASC Inc. and Inalfa Sunroofs, officially opened for business in January in Brighton, Mich.
… The National Highway Traffic Safety Administration has opened a Crash Injury Research and Engineering Network at the Medical College of Wisconsin in Milwaukee. The facility will help researchers study automobile crashes and their prevention, according to the NHTSA… The
General Motors Corp. has announced that it is closing its assembly plant in Ste. Therese, Quebec, and is phasing out the Chevrolet Camaro and Firebird… Round
Rock, Texas-based Equalizer Industries has won a "standard of excellence" award for 2001 from the Web Marketing Association
… Germany-based TH Troplast AG is constructing a manufacturing plant in the town of Bor, Germany, for the manufacture of triplex auto glass and window glass. Construction on the plant began in March 2002 and should be complete by September 2002 … Detroit-based
Ford Motor Co. has recalled approximately one million passenger cars, sport utility vehicles and pickup trucks to fix a windshield wiper motor defect. According to the National Highway Traffic Safety Administration, a switch in the plastic cover of the wiper motor gear case on certain vehicles could malfunction and overheat, which would result in the total loss of wiper function. Owner notification began in August for 1.08 million 2000-2001 model year vehicles, including the Taurus, Expedition, Focus, Excursion, F150-F650 series pickups, Continental, Town Car, Navigator and Sable models… A study by an organization called
"Help Eliminate Auto Thefts" (HEAT®) has reported that the recent economic downturn in the United States could make the automobile more important than ever. Therefore, repairs and replacements very well could also increase, as people protect this important part of their lives…
J.D. Power & Associates of Agoura Hills, Calif., has found that airbags and vehicle control systems continue to be among the most desired features consumers want to see in new vehicles, according to its annual study, which was recently released. Among these, head protection/side curtain airbags are the most desired because they reduce the effects of side-impact accidents by deploying from above the doors covering glass areas…
Delphi Automotive Systems has won production contracts worth approximately $54 million for its power sliding door. The first European application to offer a power sliding door will be in 2002, according to Delphi. The company has plans for a second application on a light-commercial vehicle soon afterwards.

OEM NEWS

Nissan Selects AP Technoglass to Provide Glazing Systems Nissan North America Inc. of Jackson, Miss., has chosen AP Technoglass, which is based in Florence, Ky., to supply glass for the company's new facility in Canton, Miss. AP Technoglass will be providing glass for Nissan minivans, trucks and sports utility vehicles, according to Craig Miller, director of transplant sales for AP Technoglass.

Miller said he attributes the new business from Nissan to AP Technoglass's Total Solutions program, in which the company provides the entire glazing system for a vehicle at one time. "Our customers continue to look for acceptable ways to reduce costs in their overall operations," Miller said. "This directly affects our role as an automotive glazing systems supplier."

KUDOS

ABRA Auto Body & Glass-Elk River Wins Liberty Mutual AwardMinneapolis-based ABRA Auto Body & Glass has announced that its Elk River repair center was awarded the 2001 Liberty Mutual Insurance award. This award is presented to outstanding repair centers throughout the country, representing those businesses that Liberty Mutual considers to be the "best of the best" in the damaged vehicle repair industry.

ABRA-Elk River is a franchise owned and operated by Kedrick Johnson of Elk River.

KUDOS

Safelite Honored by Arthur Anderson Corp.

Safelite Auto Glass of Columbus, Ohio, has been named one of Central Ohio's leading privately-held companies in Arthur Andersen's fifth annual "Discovery 100" ranking. The study, which is co-sponsored by Firstar Corp., looks at revenues and financial performance to judge
the value of the companies involved along with their customers, suppliers
and organizational cultures.